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How a rogue appeals court wrecked the patent system

Judges of the United States Court of Appeals for the Federal Circuit on October 1, 1982, the day they were sworn in by Chief Justice Burger. In the front row are Circuit Judge Giles S. Rich, Chief Judge Howard T. Markey, Chief Justice Warren E. Burger, and Circuit Judge Daniel M. Friedman.

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In 1972, the Court of Customs and Patent Appeals (CCPA) got a new chief judge named Thomas Markey. At Markey's investiture ceremony, patent attorney Donald Dunner spoke of the "anguish of the patent bar about the treatment of patents in various federal courts." The CCPA, a DC-based court that heard appeals from the US Patent & Trademark Office, was considered to be relatively pro-patent—but other federal appeals courts had jurisdiction over actual patent lawsuits and tended to be friendlier to patent defendants. Even worse, in Dunner's view, the Supreme Court itself seemed unfriendly to patent holders.

This sad state of affairs made it a bad time to be a patent attorney. Because patents were frequently invalidated by the courts, companies filed many fewer applications for them than they do today. Patents were seen as a backwater in the legal profession. Dunner urged Markey to inspire "his associates on this bench to spread the patent gospel to their sisters and brothers on the other federal benches."

A decade later, the patent bar's anguish would turn to joy as Congress merged the CCPA with another court to create the US Court of Appeals for the Federal Circuit. The Federal Circuit would be just as patent-friendly as the CCPA, but unlike its predecessor, the Federal Circuit was handed jurisdiction over all patent appeals, including the lawsuits that had previously been handled by other courts. On October 1, 1982, Judge Markey became the chief judge of the new court and set to work to remake patent law.

No institution is more responsible for the recent explosion of patent litigation in the software industry, the rise of patent trolls, and the proliferation of patent thickets than the United States Court of Appeals for the Federal Circuit. The patent court's thirtieth birthday this week is a good time to ask whether it was a mistake to give the nation's most patent-friendly appeals court such broad authority over the patent system.

The patent lawyers' court

Patent scholars Adam Jaffe and Josh Lerner tell a story in their 2004 book Innovation and Its Discontents that illustrates the problem Congress was trying to solve with the creation of the Federal Circuit. Every Tuesday at noon, a crowd would gather at the patent office awaiting the week's list of issued patents.

As soon as a patent was issued, a representative for its owner would rush to the telephone and order a lawyer stationed in a patent-friendly jurisdiction such as Kansas City to file an infringement lawsuit against the company's competitors. Meanwhile, representatives for the competitors would rush to the telephone as well. They would call their own lawyers in patent-skeptical jurisdictions like San Francisco and urge them to file a lawsuit seeking to invalidate the patent. Time was of the essence because the two cases would eventually be consolidated, and the court that ultimately heard the case usually depended on which filing had an earlier timestamp.

By 1982, concerns about the lack of uniformity in patent law had become widespread. Observers were also worried that generalist judges lacked expertise to handle the complexities of patent law. And so Congress combined the CCPA with the Court of Claims (which handled lawsuits against the federal government) to create this new court, the United States Court of Appeals for the Federal Circuit.

Enlarge/ President Ronald Reagan signs the Federal Courts Improvement Act, which created the United States Court of Appeals for the Federal Circuit, on April 2, 1982.

The new court had exclusive jurisdiction over patent appeals. Patent lawsuits were still heard by trial courts across the country, but when the trial courts' rulings were appealed, they would no longer go to one of the 12 geographically-based appeals courts that handle most other appellate issues. Instead, all patent cases would be heard by the Federal Circuit.

"Effectively reversing some major precedents"

By definition, this accomplished Congress's goals of making patent law more uniform and bringing greater "expertise" to patent issues. But it had an important side effect—making the law more favorable to patent holders.

Theoretically, the pro-patent leanings of the Federal Circuit should have been checked by a more skeptical Supreme Court. In practice however, the patent court had a great deal of autonomy.

"It is not common in the life of the law in America for a lower court and a major segment of its bar to take on the nation's highest court, effectively reversing some major precedents or at least substantially mitigating their impact," notes Steven Flanders in a recent history of the patent court. "Yet this was done."

The Federal Circuit, he said, also took on "the quieter and subtler effort to re-educate trial judges throughout the judiciary, to make them friendlier to patent-holders (or at least to the system of patents) as well." (Flanders, it should be noted, is an avowed supporter of the Federal Circuit and its efforts to reshape patent law).

This dismissive attitude toward Supreme Court precedents apparently survives to this day among patent lawyers. In the wake of this year's decision limiting patents on the practice of medicine, patent attorney Gene Quinn wondered, "How long will it take the Federal Circuit to overrule this inexplicable nonsense?" Obviously, the Federal Circuit can't "overrule" a Supreme Court decision. But with enough persistence, it can, and often does, subvert the principles enunciated by the nation's highest court. And when it does so, it almost always works in the direction of making patents easier to obtain and enforce.

This article needs far more evidence than it presents to sustain its thesis that the Federal Circuit is the bad actor and everything would be fixed if we just took away its exclusive jurisdiction.

I'm pretty sure I never claimed that "everything would be fixed if we just took away its exclusive jurisdiction."

If that's the quibble you have with my comments, then I retract it, you're right I was too broad and it was not a fair characterization of your views. But is it fair and judicious of you to brand an entirely circuit as "rogue"? I stand by the substance of the rest of my criticism of this article's content, evidence and thesis.

I don't disagree with you, I just glazed over the underlying foundation in that sentence. But, to my reading, the means is built-in alongside the purpose. What is the point of an Exclusive Right to something if not, at a minimum, to be able prevent anyone else from reaping its benefit?

The problem is in how it colors your perception. You go on to say that biotech NEEDS patents. It doesn't, and at best, it's very helpful. However, I would question even that. The biggest reason that it would be helpful is because of the high cost of FDA approval, but legal monopolies are likely not the best way to deal with that. A huge portion of the funding that already occurs comes from the NIH, and if the FDA approval process is to remain unchanged, we might as well fully fund drugs through the NIH as opposed to partially funding them and letting pharmaceutical and biotech companies reap virtually all of the benefits by holding publicly funding technology hostage.

No industry NEEDS patents per se; there are always going to be innovators who will research and commercialize inventions regardless of the legal environment. But I'd argue that biotech absolutely needs patents to recover their costs. To be sure, FDA approval costs a lot, but that isn't the sole driver by a long shot. Basic R&D and scale-up in biotech is necessarily expensive of its own accord. By and large, once a biotech gets Product A to market, the process has been made efficient enough, but there are YEARS of Product A development to pay for, as well as future pipeline costs for any Product B, C, etc. Without patent protection, there is nothing to prevent a competitor (often ex-US) to reverse engineer the thing and selling Product A without having any of the development overhead costs to deal with.

There is a huge amount of government funding, but fully funding biotech research via the NIH/FDA would get disturbingly close to making the entire industry just another agency of the government, which I don't think anyone would consider to be beneficial to innovation, efficiency, or competition. It can be unseemly (and feel immoral) when inventions paid for in-part by the government are kept private. But there is still a huge amount of risk involved for the companies; a legal monopoly is not the same thing as a viable economic monopoly, there is no guarantee the company will make it's investment back. The government is subsidizing in-part the failures (from which we learn) as well as the successes; I would hate to see any government oversight-focused politician start asking questions of fully-funded biotech companies, "Why is your science not producing successful things with taxpayer money on a predictable schedule?". "That's not the way science works, Congressman," wouldn't be a compelling answer.

So we let companies that get federal funding have patents, because we don't want the government to micromanage companies, but we can't trust the market to give the companies the ability to make a profit. That helps "promote the progress" as best as the politicians know how.

This article needs far more evidence than it presents to sustain its thesis that the Federal Circuit is the bad actor and everything would be fixed if we just took away its exclusive jurisdiction.

I'm pretty sure I never claimed that "everything would be fixed if we just took away its exclusive jurisdiction."

If that's the quibble you have with my comments, then I retract it, you're right I was too broad and it was not a fair characterization of your views. But is it fair and judicious of you to brand an entirely circuit as "rogue"? I stand by the substance of the rest of my criticism of this article's content, evidence and thesis.

And I think the Supreme Court never overturning those Federal Circuit rulings for 15 years means those decisions didn't trouble the Supreme Court. Court decisions that aren't overturned for years and years despite many opportunities to do so are hardly "rogue." I give the Supreme Court a lot more credit than you apparently do in knowing what it does when it denies certiorari.

Newsflash - for judges, the standard for knowing that they "systematically mis-interpret Supreme Court precedents" is that they get overturned, not because academics and writers publish articles saying they've gotten it wrong. Until only recently, those Federal Circuit rulings have been upheld. If you're a Federal Circuit judge writing decisions that don't get overturned for years and years despite repeatedly having those decisions appealed to the Supreme Court, it's pretty natural to think you're getting it right and in line with what the justices want.

The more recent back-and-forth between the Federal Circuit and the Supreme Court is not an abnormality but a natural process of refinement as the Federal Circuit judges are trying to figure out for themselves where the new lines are being drawn. It isn't a sinister act of judicial defiance but smart, dedicated judges trying to figure out what is expected of them now. Your rhetoric and the picture you paint is overblown.

Very interesting article. It's illuminating to learn some of the history of how we got where we are today with patents. Reading the comments and the replies from Tim added to it.

Another factor (IMO) that differentiates biotech patents from software patents is the "simplicity" of the patent. From what I see, with drugs the patent protects the chemical composition - that can be clearly stated and tested. However with software it ends up being a vague description trying to encompass as many ways as possible of doing something, intended to block other implementations which are not the same.

Smartphones have become the perfect patent storm because they incorporate so many functions and are evolving so quickly. There's no way around them including a tremendous number of patented concepts - many, if not most of them software-related.

Patent are a legal monopoly intended to provide an inventor with the protection needed to reap the financial reward of a worthy invention

Again, that is absolutely NOT the purpose of patent law, as clearly established in Feist v. Rural, and that holding stands to this day. As I said, the purpose is SOLELY to encourage innovation and creativity. Anything else is a means to that end, be it carrot or stick, but a means just the same. The PURPOSE is explicit, and the means "control."

It had been a while since I read Feist v. Rural, but I am pretty sure it didn't get into the purpose of patent law. They made their decision on the issue of copyright law. You can argue that the reasoning in Feist v. Rural can be extended to patent law if you want, but that's not what Feist v. Rural established on its own.

On the larger issue, I won't call CAFC as rogue. As stated by other, both SCOTUS and Congress have their opportunities to have their say. SCOTUS have/had no program watch out for "rouge" decision on 9th Circuit death penalty cases,(Which I think had been exaggerated, but there were really a few outlier decisions.) and swiftly administer their "bench slap." There are no reason they couldn't do the same to CAFC if they feel the need to do so. And as Ledbetter v. Goodyear demonstrated, Congress are also perfectly willing to change the law if they disagree with the judicial interpretation, and 'clarify' their intent. Their (mostly) silence is a clear indication that CAFC is hardly consider rogue. How many congressional hearing had been hold over the issues of 9th Circuit? Quite a few. Compare and contrast that with how many congressional hearing over CAFC?

I think the only legit issue is the "regulatory capture"/"Empire building" aspect of specialization. By making their specialized domain more important, they have more prestige, attract better quality of clerk applicants, etc. in comparison with their other article 3 appeal judges. I think an easier solution to this issue is to maintain the CAFC, but have judges sitting by designation for fixed term from the geographically based circuits. That way, more diverse view points from different circuits are preserved, and they can bring their learned expertise to their circuit once they finished their term. The one example I can think of is the Judge Fogel's appointment to direct Federal Judicial Center. That's if Congress feel a need to change. But I think it's safe to say, as it currently constituted, Congress is generally content with status quo in regard to CAFC.

I would think that "the purpose of patent law" -- as a normative question, or maybe a language question -- is a matter that all participants can freely debate, open to every basis of opinion.

Its purpose is not automatically determined by a court! The U.S. Constitution is extremely convincing, but it's not holy writ. Only lawyers are trained to put their brains in this box.

There are plenty of alternative overlapping intellectual foundations one can draw upon to argue the purpose of patent law (or define it, or delete it) : economic arguments, natural rights (pro and con), European notions of patent, legal scholarship, intentions of lawmakers or other protagonists, rational reconstruction, Edison and Tesla, google N-grams, the OED, the hermeneutics of suspicion, the DSM-IV, the Church fathers, game theory, oracles, anecdotes, literature, statistics, whatever. Some theories are totalizing, some clearly incomplete. Some are more convincing than others. You name it.

Perhaps it would be more useful (or accurate) to qualify it:

The purpose of patent law, as most people see it... (a can of worms, but a smaller one)The purpose of patent law, as any sensible person would see it... The purpose of patent law, according to the legal tradition, The TRUE purpose of patent law... According to a Freudian deconstructive analysis of Jefferson's postcards, the purpose of patent law is...

Name the devil and he loses half his power. Qualify your argument and it loses scope but gains in credibility.

Then people can still disagree on substantive issues without trying to "Win by Word", i.e. claim a monopoly on a phrase and enforce it by appeal to authority, then use the conflations to draw real conclusions.

Its purpose is not automatically determined by a court! The U.S. Constitution is extremely convincing, but it's not holy writ. Only lawyers are trained to put their brains in this box.

Except it is. Another country's interpretation of the purpose of patents is entirely irrelevant as far as their legal basis in US law goes, just as other countries couldn't care less what the US constitution has to say about it.

The purpose of patent law is so that people can share their ideas, being granted a temporary monopoly on ideas that belong to everyone; the whole of humanity gets to benefit. People are allowed to create their own cotton gins by reproducing the instructions in the patent, they just can't sell them until the patent expires.

I'm sorry, but like many people today, you seem to misunderstand the purpose of patent law. The purpose of patent law is, and I quote: "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;" -- Constitution of the United States of America, Article 1 §8 Clause 8.

..

The purpose, as you put it, is NOT to allow people to share their ideas.

Well, that's not entirely true; you only get the limited monopoly in exhange for public disclosure of your invention, with the aim being that everyone will be able to use that idea once the limited monopoly has expired. The alternative is for companies to protect IP as trade secrets, which are just as legally protectable but don't enter the public domain at the end of exclusivity.

I don't disagree with you, I just glazed over the underlying foundation in that sentence. But, to my reading, the means is built-in alongside the purpose. What is the point of an Exclusive Right to something if not, at a minimum, to be able prevent anyone else from reaping its benefit?

The problem is in how it colors your perception. You go on to say that biotech NEEDS patents. It doesn't, and at best, it's very helpful. However, I would question even that. The biggest reason that it would be helpful is because of the high cost of FDA approval, but legal monopolies are likely not the best way to deal with that. A huge portion of the funding that already occurs comes from the NIH, and if the FDA approval process is to remain unchanged, we might as well fully fund drugs through the NIH as opposed to partially funding them and letting pharmaceutical and biotech companies reap virtually all of the benefits by holding publicly funding technology hostage.

I'm sorry but this simply isn't true, and I say that as someone who's background is academia and now NIH. If you want NIH to start paying for phase III trials, then say goodbye to everything else it funds because there isn't the money to do both. And there are more forms of IP exclusivity in biotech than just patents; look at the rules regarding data exclusivity (a power Congress gave FDA). For new chemical entities like drugs, I don't think anyone would say that patents aren't justified, they are. In my opinion, the problems occur with methods patents (Mayo v Prometheus, or Myriad's genotype-phenotype association claims).

No industry NEEDS patents per se; there are always going to be innovators who will research and commercialize inventions regardless of the legal environment. But I'd argue that biotech absolutely needs patents to recover their costs. To be sure, FDA approval costs a lot, but that isn't the sole driver by a long shot. Basic R&D and scale-up in biotech is necessarily expensive of its own accord. By and large, once a biotech gets Product A to market, the process has been made efficient enough, but there are YEARS of Product A development to pay for, as well as future pipeline costs for any Product B, C, etc. Without patent protection, there is nothing to prevent a competitor (often ex-US) to reverse engineer the thing and selling Product A without having any of the development overhead costs to deal with.

Except that reverse engineering and scaling up production takes time. In that time successful products have a chance to recoup their R&D costs.

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There is a huge amount of government funding, but fully funding biotech research via the NIH/FDA would get disturbingly close to making the entire industry just another agency of the government, which I don't think anyone would consider to be beneficial to innovation, efficiency, or competition.

Actually, it would create a common base of knowledge that a competitive market could build upon. The government, and perhaps a number of charities, academic organizations, etc., would engage in the parts that are not profitable, and private companies would engage in the parts that are. That's the whole idea behind government funded research. If it were going to be profitable on its on within a reasonable timeframe, it'd be a total waste of money.

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I would hate to see any government oversight-focused politician start asking questions of fully-funded biotech companies, "Why is your science not producing successful things with taxpayer money on a predictable schedule?". "That's not the way science works, Congressman," wouldn't be a compelling answer.

The funding would probably go mostly to university labs. It's quite likely that little would go to private industry other than perhaps manufacturing, which would be handled via contracts.

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So we let companies that get federal funding have patents, because we don't want the government to micromanage companies, but we can't trust the market to give the companies the ability to make a profit. That helps "promote the progress" as best as the politicians know how.

Why should we allow them to double dip? Even if you support patents, you can still attach strings to federal research dollars. If someone wants a patent, then they've got to do it without taxpayer dollars. If someone wants taxpayer aid, they have to freely publish their findings and not patent it.

I'm sorry but this simply isn't true, and I say that as someone who's background is academia and now NIH. If you want NIH to start paying for phase III trials, then say goodbye to everything else it funds because there isn't the money to do both.

I seem to recall the NIH laying down roughly half the money needed to get a drug to the market. We could thus change the policy to fully funding half as many drugs, and get those drugs without the economic burdens of patents. That number of drugs could quite possibly be of greater social value since there would no longer be economic incentives to make redundant drugs for highly profitable markets, and this is assuming that there is zero private sector investment and no reform to FDA approval.

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And there are more forms of IP exclusivity in biotech than just patents; look at the rules regarding data exclusivity (a power Congress gave FDA). For new chemical entities like drugs, I don't think anyone would say that patents aren't justified, they are. In my opinion, the problems occur with methods patents (Mayo v Prometheus, or Myriad's genotype-phenotype association claims).

I would say that patents aren't justified on chemicals. Patents are a fundamentally flawed idea, a backwards economic concept that has somehow survived into modern economics.

It's very easy to use biotech as an example where patents are always necessary, regardless of their nature.

Fine, can every single research establishment that receives government funding related to drug discovery or biotech: open access all its journals, share its data through open linked data and patent their discoveries, opening them as science commons paid for by all, ala other free and open standards.

Do that and we'll see where the "innovation" in this field actually comes from.A fair chunk of the supposed innovators are just living off of "commons" they didnt even help to create.

... thinking that you can't create your own cotton gin even when not for sale ... that the creations of mankind don't belong to everyone ...

I hold these the actions of these individuals to be anti-humanitarian, to further the suffering invited on mankind through laws whose rewired motivation was only for golden-parachute profits, not to spur innovation.

Amen. Ultimately, the advent of computer technology has achieved the dawning of the era of free information for humanity. Computers and networks operate by duplicating and distributing information, at a truly trivial cost. To ignore, vilify and squander this incredible, revolutionary wealth is anti-humanitarian. If the printing press was a significant step in human history for the information revolution it enabled, by radically lowering the cost duplicating and distributing information (no more hand copied books), then computers and the internet are that step taken to its final conclusion: free.

In the long view, the fundamental concept of IP cannot be expected to withstand this technology, and all efforts to protect such concepts can only be seen as a fading transition to some new kind of economy of information that properly exploits the incredible wealth of free information.

I don't know how such a future will work. I don't know how it will pay people who create and manage information. But I think that the brute force of the technology, combined with the potential competitive advantages of leveraging the wealth of information freed, must inevitably come to dominate our information economy. Clinging to concepts of IP protectionism does not help us advance our thinking in the right direction, does not lead us to visionary insight about how to create a better future and exploit it to maximum advantage. We should be thinking ahead and planning the full abolishment of patents and copyrights, as obsolete concepts, figuring out the new problems that will need to be solved, and figuring out excellent solutions to those problems.

The sentiment is truly inspiring -- including the call for new norms for economic life, arising out of technological realities, to replace the notion of IP.

But how do you know it might not be the ultimate dystopia, where Big Copy controls everything, on permanent lockdown, all the time, purely to prevent intellectual property crime?

Because, as often claimed, with electronic media you have to do this or lose all control.

Intellectual property protection could be viewed as analogous to economic collectivism -- a nice idea in principle, but requiring so much interference in the "natural, instinctive" microstructure of everyday life that we're better off without it. (Just remember what it took to separate smallholders from their land in the Soviet Union.)

So you have to kind of limit it. But IP won't wither away all by itself. There are interested parties here.

I'm sorry but this simply isn't true, and I say that as someone who's background is academia and now NIH. If you want NIH to start paying for phase III trials, then say goodbye to everything else it funds because there isn't the money to do both.

I seem to recall the NIH laying down roughly half the money needed to get a drug to the market.

That's simply not true. I would welcome any references you have to support that claim, because I've never seen anything that would come near to that. NIH's role is to fund the kind of basic biomedical research that industry doesn't fund. Industry, OTOH, does an awful lot of drug development (not research, it's the other half of R&D) that academia has no expertise in.

The problem comes in when attorney's interpret the law in their favor, thinking that you can't create your own cotton gin even when not for sale (protecting profits by forcing consumerism), that the creations of mankind don't belong to everyone, that it is our right to hold others in debt ... yes, even by threatening them with detention, or debtor's prison reborn. The same issue occurs with copyright. I hold these the actions of these individuals to be anti-humanitarian, to further the suffering invited on mankind through laws whose rewired motivation was only for golden-parachute profits, not to spur innovation.

And what is your argument that a invention of one person is inherently the property of all humanity? Methinks that you are torturing your logic against the Geneva convention rules.

What are some examples of cases where the CAFC adopted a pro-patent stance and the Supreme Court affirmed it?

Every time the SC denies certiorari on a patent case brought before them, they are essentially affirming the CAFC's decision.

Nope, that's not how the law works. Denying cert just mean the Supreme Court thinks the case isn't worth its time. It doesn't necessarily indicate it agrees with the holding.

Nope, that's Tim Lee's personal interpretation of what a cert denial means - it may mean that but it may also mean the Supreme Court agrees with the opinion so it doesn't want to review it simply to affirm it. Since the Supreme Court typically doesn't explain why they denied cert, it's open to interpretation what the motive for the denial is. What is not open to interpretation is the judicial consequences of that denial, which, in the patent area, ends up creating great precedential weight to the Federal Circuit decisions that are left standing.

It's true enough that denying cert doesn't necessarily mean that the Supreme Court endorses the reasoning in the lower court opinion but until the SC overturns that opinion, that lower court decision stands as precedent that other courts follow. This is especially magnified for Federal Circuit opinions since they are designated as the appellate circuit for patent matters and because the Federal Circuit's jurisdiction extends nationwide. Because it is not geographically limited as other circuit appellate courts are, the Federal Circuit opinions that are left standing are opinions that federal judges everywhere in the country must follow, no matter where they are located. Even other circuit appeals courts are bound by the Federal Circuit decisions since the latter has exclusive subject matter jurisdiction over patent disputes.

1. I see nothing wrong with the fact that the CACF upholds more patents than the prior system. There's nothing inherently bad about this.

2. The CAFC does not rule patent law. Congress has a very important role to play here, and by all accounts there are ongoing efforts to reshape patent law. The CAFC can only be blamed so much with their interpretation of patent law.

3. As other posters have noted, the modern "patent troll" is just another manifestation of corporate use of the patent system for purposes other than it was intended. It happened before the CAFC, in different ways, and it will probably continue no matter what happens. Companies will always use the law to their advantage in creative ways. If you think eliminating patents would solve this problem you're crazy.

4. The CAFC should be overseen by the Supreme Court, but the Court has not been receptive to these cases. On one hand, the Court is wise to leave patent matters up to patent experts (and remember as federal judges they have life tenure, so even if the CAFC judges are largely patent lawyers that's not such a bad thing). On the other hand, it needs to step in from time to time, so long as it doesn't mess things up more. Many people have criticized the Court's prior rulings as well, so let's not overstate that possibility as a good solution.

TLDR: It's not as simple as a "rogue" court wrecking a patent system (nice attention grabber though). It was messed up before and it's going to take a lot of parties working together, including Congress, to fix the current problems.

I rarely, if ever, agree with anything Tim writes on patent law - in my opinion he FAR too often confuses what he thinks the law should be with what it actually is. If I wasn't too busy destroying the US economy drafting software patents, etc., and if I didn't think taking a pro-patent stance on an Ars forum was an even greater blunder than getting involved in a land war in Asia, I'd love to explain why.

However, just for the record, I, like every other practicing patent attorney out there, have a moral, ethical, and legal obligation to zealously advocate for the best interests of our clients within the bounds of the law as it exists and, in some respects, to do our damnest to push those boundaries as hard as we can. If I were to go to a client and say, "Hey, I know you all like this new feature you developed and want to try for a patent on it and all ... but don't you think there's something to the argument that software patents in general are bad economic policy, and don't actually stimulate innovation that much? Maybe you should just implement it and let the market decide instead." I wouldn't be doing my job.

But just to try and trim one minor thread of misinformation before it goes too far:

ddarko wrote:

Nope, that's Tim Lee's personal interpretation of what a cert denial means - it may mean that but it may also mean the Supreme Court agrees with the opinion so it doesn't want to review it simply to affirm it. Since the Supreme Court typically doesn't explain why they denied cert, it's open to interpretation what the motive for the denial is.

Tim is absolutely right about what a cert denail means - it is the Court declining to review the lower court's decision. Since they don't review it, they can't possibly be seen to be giving any kind of approval to its merits.

The Supreme Court is busy. It can't review every decision the CAFC makes, or even pay close attention to every cert petition. This gives the CAFC significant latitude to ignore or undermine SCOTUS precedents. This is *why* a more decentralized structure is desirable. Other circuits are more likely to faithfully uphold SCOTUS precedents. And when the CAFC wanders off the reservation it would be more obvious since other circuits would directly contradict them.

Your theory posits that healthy competition between the circuits will create splits among them that can only be settled by the Supreme Court. You can hardly say the Supreme Court's has been too "busy" to effectively watch over the Federal Circuit then propose a remedy that is likely to generate even more casework as the inevitable splits among the circuits occur. Which is likely to be more burdensome to the Supreme Court - keeping watch over patent decisions in one circuit or twelve?

Your theory assumes as true a proposition that it needs to provide evidence for - that the Supreme Court hasn't reviewed Federal Circuit because it's been distracted by its case load. Case load is an issue for all areas of law that come before the Court so I don't see why patent law should have been particularly impossible for the Court to effectively review. Occram's rule - the more simple - and mundane - reason the Supreme Court hasn't reviewed many Federal Circuit court decisions until recently is that the justices largely agreed with them. The recent string of reversals indicates more skepticism which is good. But that skepticism comes from the justices and won't necessarily be encouraged by returning patent review to all the circuits.

Or Occams Razor can also suggest, without stumbling into the realm of impossible, that they were actually too busy with more important cases to handle. You further this slice, as did the article, with your last few sentences by acknowledging that the SCOTUS has rejected several cases. I do not think you are using that razor you borrowed correctly.

To illustrate this point, consider a method claim for "placing an object in a container." Seems simple enough, right? Now, tell me what the word "in" means. Does it mean partially inside? Wholly inside? In some circumstances, it means partially inside (such as when a garbage bag is said to be "in" the container). In other circumstances, it means wholly inside (a person is in a building). Presumably, since we're dealing with a patent, this invention is "novel," so neither of these two usages is directly applicable - we have to define "in" in the context of THIS invention. The point is that even simple, ordinary, everyday words are ambiguous, and there is simply no way that one statement of law can account for all the nuances in our language.

I would argue that this is part of a bigger problem. We shouldn't be making language fit the patent but making the patent fit the language. If the patent is deffined in an ambiguos manner then the patent becomes invalid because of this ambiguity. Does this suck for some people, sure but it would clearly define the patent in a manner that becomes easier to determine the basics in order to form a ruling and begin to remove some of the complexity.

What are some examples of cases where the CAFC adopted a pro-patent stance and the Supreme Court affirmed it?

Every time the SC denies certiorari on a patent case brought before them, they are essentially affirming the CAFC's decision.

That's a rather disingenous argument. It leaves no possiblity for the SCOTUS to honetsly have too much on their plate to take anything else on. They don't even have to look at or discuss the case. Denying Cert does not implicitly reaffirm the decision.

Tim is absolutely right about what a cert denail means - it is the Court declining to review the lower court's decision. Since they don't review it, they can't possibly be seen to be giving any kind of approval to its merits.

I think you've missed my point - I didn't say the denial of cert definitely means approval of its reasoning (of course it doesn't mean that for sure). I said that denial of cert doesn't mean that a heavy case load was the cause - the Court was "too busy" to review it, as Tim described. I was pointing out it's equally speculative on his part to assert that a heavy case load is the reason a cert is denied. Maybe it is, maybe it isn't, the only people who know why cert was denied are the justices and their clerks. But my criticism isn't about the correct motive behind the denial of cert, which is irrelevant. What's important is the real world judicial consequences of that denial. The lower court decision remains standing as valid and has precedential authority as a lower court decision, albeit not as Supreme Court decision. So while it may not have the ultimate stamp of approval, those decisions have near-ultimate stamp of approval until they ARE overturned, especially in the patent area since even the other appeals courts must follow the Federal Circuit's decisions.

As best as I can make out, Tim's argument seem to be that because the Supreme Court didn't accept and uphold the Federal Circuit patent decisions that he detests so much, that means the Court never approved of the Federal Circuit's approach and thus, the circuit decisions were "rogue." I regard this hair-splitting as absurd and divorced from the real world. The Supreme Court justices are well aware of the practical and judicial consequences of their years of cert denial meant those Federal Circuit decisions would be followed as the law of the land until they issued a contrary opinion. Allowing the Federal Circuit decisions to remain valid through literally hundreds of patent cases that cited and relied on those circuit decisions may not mean that the Supreme Court and Congress ever endorsed the Federal Circuit decisions in the literal sense but doing nothing made them responsible for those decisions and their consequences. If you let a dog off his leash and refuse to pull him back when he goes around biting people, you can't turn around and claim the dog had gone "rogue" and you bear no responsibility for his actions. Most observers could easily see through the sham of such hair-splitting and pinpoint ultimate responsibility for the dog's actions on the owner yet this article employs the same argument.

What I really don't understand is why because it's completely unnecessary. Tim Lee could have easily said the Supreme Court, Congress and the Federal Circuit have allowed patent law to stray too far from its roots but that there is growing recognition on the Court that more balance needs to be returned to the equation and that has led to an increasing number of Federal Circuit decision being overruled. Instead, he sets up the Federal Circuit as the Boogie Man of American jurisprudence. It's a caricature drawn from tabloid headlines and conspiracy theories not serious journalism about the law.

However, just for the record, I, like every other practicing patent attorney out there, have a moral, ethical, and legal obligation to zealously advocate for the best interests of our clients within the bounds of the law as it exists and, in some respects, to do our damnest to push those boundaries as hard as we can. If I were to go to a client and say, "Hey, I know you all like this new feature you developed and want to try for a patent on it and all ... but don't you think there's something to the argument that software patents in general are bad economic policy, and don't actually stimulate innovation that much? Maybe you should just implement it and let the market decide instead." I wouldn't be doing my job.

Thanks for the thoughtful comment, but I think you're conflating two different issues. Obviously, in your role as a practicing patent attorney, you have an obligation to advocate the best interests of your clients. But patent lawyers as a class also do things that aren't on behalf of any specific client. The patent bar, via professional organizations, files amicus briefs in court cases. They give speeches at dinners urging judges to spread the "patent gospel." They write blog posts deriding Supreme Court decisions as "inexplicable nonsense." And once in a while, they get appointed to the bench.

I just got an email from a law student who says he decided not to go into patent law because (in his words) "there is almost no way to be a reformist patent lawyer." According to him, you have to buy into the pro-patent ideology of the patent bar in order to succeed in the profession. I think that's a problem. So while I wouldn't criticize any lawyer from zealously advocating the interests of clients in the courtroom, I absolutely will criticize patent lawyers who push policies *outside* the courtroom that systematically benefit the patent bar at the expense of the rest of society.

From Justice Stevens' concurrence in the Supreme Court's Bilski decision:

"[Thomas Jefferson] drafted the 1793 Act, and, years later, explained that in that Act 'the whole was turned over to the judiciary, to be matured into a system, *under which every one might know when his actions were safe and lawful[.]'"*

By that measure, the entire patent system is a thorough and abject failure. With patent claims drafted in legalese to be as broadly encompassing as is arguably possible whilst still revealing as little as possible, patents impart next to no knowledge useful so that one skilled in the art "might know when his actions were safe and lawful." Patents are the province of lawyers and judges, not of practitioners.

Indeed, our Founding Fathers had so little confidence in patent and copyright monopolies that they granted Congress the power to create patent and copyright systems but did not require that they be created, a point also specifically addressed by Jefferson in the context of Natural Law rights:

"Stable ownership is the gift of social law, and is given late in the progress of society. It would be curious then, if an idea, the fugitive fermentation of an individual brain, could, of natural right, be claimed in exclusive and stable property. If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property. Society may give an exclusive right to the profits arising from them, as an encouragement to men to pursue ideas which may produce utility, but this may or may not be done, according to the will and convenience of the society, without claim or complaint from any body." VI Writings of Thomas Jefferson, at 180-181 (Washington ed.).

Presumably then, it lies within the Congressional Power to abolish the patent system, leaving only the issue of just compensation for those who had investment-backed expectations in patents already issued, a question of damages rather than Congressional Power. Even that issue might be avoided by simply prohibiting the issuance of new patents and allowing existing patents to expire.

What are some examples of cases where the CAFC adopted a pro-patent stance and the Supreme Court affirmed it?

Every time the SC denies certiorari on a patent case brought before them, they are essentially affirming the CAFC's decision.

Nope, that's not how the law works. Denying cert just mean the Supreme Court thinks the case isn't worth its time. It doesn't necessarily indicate it agrees with the holding.

I understand the differences between denying cert—and overruling or upholding a lower court decision. You missed my qualifier "essentially," by which I meant "for all practical purposes" and "for the time being." Legal arguments take time to evolve, or even become apparent enough to influence long term public policy.

Its purpose is not automatically determined by a court! The U.S. Constitution is extremely convincing, but it's not holy writ. Only lawyers are trained to put their brains in this box.

Except it is. Another country's interpretation of the purpose of patents is entirely irrelevant as far as their legal basis in US law goes, just as other countries couldn't care less what the US constitution has to say about it.

I think you mean that each country's legal system is autonomous. That is a valid point, even in today's interconnected world -- I don't live anywhere near the US.

And by qualifying your assertion with the phrase "as far as their legal basis in US law goes", you eminently illustrate my point that narrowing the claim with a few extra words can eliminate a lot of trivial disagreement, while leaving space for discussions of substantive issues like why we really have patents, or should have them.

If another person writes "the purpose of patents from the point of view of society", he's free to include larger purposes that may have led to the law as it stands, that belong to the social consensus on patents. These purposes may be attested outside of the legal system, for example in public debate or through the observation of practice. Or (with another set of qualifiers) it might be a reconstruction of the secret, real purposes of patent law, as an anthropologist or a Marxist might do -- thus my reference to the hermeneutics of suspicion. Or, like most of the posters on this thread outside of the legal experts, he might simply be expressing his own view of the purpose that patents serve.

All this is a far cry from citing 1-8-8 of the Constitution and going home, when the discussion actually concerned one of these other spheres.

Incidentally, other countries are not immune to the attractions of the US Constitution. It's a brilliant document, nearly flawless, deeply liberating, and widely admired in Europe and everywhere. Certainly worth studying line for line.

You say "Except it is" and by that I think you mean "The Constitution is holy writ". The comparison is a good one. You could read Drew Gilpin Faust's essay that I call "The City upon a Hill" about the Puritan founders and their gradual evolution to rational liberals, and be convinced that there is a red thread of inspiration connecting the two documents. It's almost magical. Might even be better written than the Bible. But still Menschenwerk, you know. Or to be precise "any remaining flaws are the sole responsibility of the author".

Just to sum up: citing the Constitution is great legal scholarship -- indeed there it is the final word, as you imply -- and it's a fantastic source of important distinction and principles for more general discussions, but shouldn't be used to arbitrarily limit anyone's freedom of argumentation.

I just got an email from a law student who says he decided not to go into patent law because (in his words) "there is almost no way to be a reformist patent lawyer." According to him, you have to buy into the pro-patent ideology of the patent bar in order to succeed in the profession. I think that's a problem.

Whatever our personal views on the law and public policy might be, I don't know a lot of attorneys who practice reformist tax law, reformist bankruptcy law, reformist estate planning law, etc., although I'm sure there are many lawyers out there who think those areas of the law should be changed.

So, while I can understand that student's frustration, particularly if patent reform is something he's passionate about, I don't think it's buying into the "pro-patent ideology of the patent bar" as much as it's an economic reality of practicing law. To make a living as a lawyer you have to be able to find people who are willing to pay you for your time to look after their interests. I can't really think of anyone, other than possibly the EFF or some similar group, who has the economic motivation to hire a patent lawyer to take a reformist position, especially not at typical patent lawyer prices.

Where you do see people practicing "reformist" law tends to be in areas like environmental law, civil rights, criminal defense, etc. But those are extremely passionate people who, in the vast majority of cases, sacrifice their own potential livelihood in order to pursue what they perceive is a greater societal good.

In other words, I might ask your law student whether, rather than just not being able to figure out a way to practice reformist patent law, he just couldn't find anyone willing to pay him what he felt he was worth to do it.

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So while I wouldn't criticize any lawyer from zealously advocating the interests of clients in the courtroom, I absolutely will criticize patent lawyers who push policies *outside* the courtroom that systematically benefit the patent bar at the expense of the rest of society.

I wholeheartedly agree, at least in the sense it's reasonable to criticize someone who advocates for a policy that you disagree with - but it's no different from any other special interest lobby.

So, while I can understand that student's frustration, particularly if patent reform is something he's passionate about, I don't think it's buying into the "pro-patent ideology of the patent bar" as much as it's an economic reality of practicing law. To make a living as a lawyer you have to be able to find people who are willing to pay you for your time to look after their interests. I can't really think of anyone, other than possibly the EFF or some similar group, who has the economic motivation to hire a patent lawyer to take a reformist position, especially not at typical patent lawyer prices.

I don't think his point was that he'd sometimes need to take "pro-patent" positions in his practice. I think his point was that advocating "reformist" positions outside the courtroom would cause him to be ostracized by other patent lawyers, including potential employers, thus limiting his career prospects.

Or Occams Razor can also suggest, without stumbling into the realm of impossible, that they were actually too busy with more important cases to handle. You further this slice, as did the article, with your last few sentences by acknowledging that the SCOTUS has rejected several cases. I do not think you are using that razor you borrowed correctly.

The SCOTUS granting Cert well below the level of its recent history, about half the number granted back in say, 1984. If they deny cert, it doesn't mean that they have more important cases to take care of, it just means it's not important enough for them. If the justices are truly annoyed by a particular circuit of appeal's constant attempts to circumvent their ruling, they can ramp back-up to the 1980s caseload easily, if they feel it is important enough to deliver a smack down. Case to the point, a few example from the so-called the 9th Circuit/SCOTUS AEDPA war:

What are some examples of cases where the CAFC adopted a pro-patent stance and the Supreme Court affirmed it?

Every time the SC denies certiorari on a patent case brought before them, they are essentially affirming the CAFC's decision.

That's a rather disingenous argument. It leaves no possiblity for the SCOTUS to honetsly have too much on their plate to take anything else on. They don't even have to look at or discuss the case. Denying Cert does not implicitly reaffirm the decision.

You're missing the point which is that it's irrelevant what the motive for a cert denial is, whether it's because the case load is too heavy, whether they agreed with the decision, whether the justices wanted to go golfing for the weekend and couldn't be bothered. I had two points which I'm sure everyone is sick of so I apologize:

1) that your belief that certs are denied because the Court is too busy is just as speculative as any other reason; and

2) motive for cert denial is unknowable by anyone outside the Court but also irrelevant to the discussion here. The only thing that matters is that Supreme Court cert denials over two decades of patent cases made the Federal Circuit opinions the law of the land. The Supreme Court and no one else is responsible for the development and the legal consequences of that situation. To pin the blame on the Federal Circuit as a rogue body is fanciful fiction and wrong.

My perspective is that the law is a pendulum; for patent law pre-1982 the pendulum was too far to the side of irrelevance, today it is more on the side of interventionism. There is a happy medium somewhere between the two.

Entirely a lawyer's perspective, without a doubt... Of course, it's rubbish. Judges aren't supposed to look at aggregate percentages and statistical analyses to decide how to rule in their cases, they're being paid to hear each case by way of its individual merits, and to rule on those merits. Sure, lawyers would love a "happy medium" where they could statistically feel comfortable with the prospect of a 50% chance at a win, but it should never work out that way. Why? Because all lawyers and all cases are not equal; one lawyer's case will have much more merit than another, etc. If 98% of the patent-holder cases brought are bad cases; that is, they have no merit or concern patents that are too obvious to garner patent protection in the first place, then the proper judicial record would reflect patent-holders losing 98% of the time (at least), and this would be perfectly proper in every respect. The "pendulum" as you define it here is an artificial construct without meaning in intellectually honest jurisprudence. It's easy to see why it might appeal to an attorney, but it is still without merit. The idea of patents and courts is rather *not* to play percentages.

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Patent are a legal monopoly intended to provide an inventor with the protection needed to reap the financial reward of a worthy invention. The biotechnology industries need this protection desperately, considering the time and capital outlay required to develop their inventions. Anything granting a monopoly is prone to abuse, and uniting patent appeals under one court was designed to curb certain abuses. More abuses have arisen, and the law will adjust, but the law moves slowly in getting anywhere, which feels incredibly inadequate when it comes to the high tech industries but the law will get there, eventually. Does this feel unsatisfactory? Yes. Welcome to living in a democratic bureaucracy, if you have a better system let us know.

My perspective is that patents handled as copyrights are a completely legitimate form of protection and should represent the highest bar of protection that inventors should receive. An inventor has the right to a temporary monopoly on his invention--that is, an invention so defined by engineering schematics, or biological schematics, as you mention, and as such is something that can be assessed objectively. What's wrong with the patent system today is fairly obvious: let's take the Apple-Samsung case(es) just generally...

Apple has publicly stated that certain of its products have been "slavishly copied" (quote, unquote) in some of Samsung's products. A comparison of the engineering schematics for each product would quickly prove objectively that Apple's charge is bogus, as many, many significant departures from the Apple designs could be noted--even by laymen. ---We need this kind of laymen-friendly evidence because it is laymen who are often asked to render these decisions, as in the recent Apple jury case. But, engineers as well as laymen are also capable of looking at schematics and finding differences--or of declaring "slavish copies" and the like.

So why aren't things as simple and as straightforward as they should be? Because the majority of litigation lawyers who now sit on benches or sit in Congress do not wish them to be that simple. After all, lawyers have to eat, too, don't they? You probably won't be surprised to hear me say, "No...I actually don't think it's important if they eat." Let them try on another profession, by all means, but let's not lay down the law for the sake of their convenience and benefit. Patent law today is a horrible mess--and just maybe, as your post indicates--all of it should be invalidated. Maybe it has been rotten from the beginning. It's always seemed to me that protection based on the engineering schematics of an invention as afforded by copyright should be sufficient to protect individual inventions, regardless of what type of invention it happens to be.

But basically patent law is sometimes interpreted these days as an inventor designing a certain kind of door, for instance, and then believing that his patent is actually a patent on all doors, regardless of how any other door may fundamentally differ from the door he has actually invented. I think patent law is therefore just bad law because it is far too broad, in just this manner. Protecting a specific invention is one thing; granting a patent-holder the ownership rights to every other *similar* invention ever made is just nuts, imo.

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(All of my anecdotal assertions above are based on being a patent lawyer and interactions with other attorneys, judges on the Fed Cir, and those judge's clerks.)

The idea behind patents is to drive innovative, risky behaviour that companies would not otherwise invest in (because on the whole, most business is risk-adverse) by granting the patent-holder a time-dependent monopoly on the sale of their invention, with most market-based societies striving for fewer monopolies. The prospective patent-holder therefore has to show that their invention is innovative, new (in the sense of never attempted before) and non-trivial - in the steel industry, whenever someone asks why we do something that is difficult, we answer, "Because if it wasn't difficult, everyone would be doing it".

In capital-intensive industries, such as most manufacturing industries (metal-making, vehicle fabrication, chip foundries) patents allow companies to try risky, high-capital ideas with the knowledge that with a patent, the payback period becomes shorter because they have no competition - so long as the patent-holder actively defends their patent, i.e. if a competitor copies the patented product or process, the patent-holders have to litigate against them or else the courts may say that the patent isn't so important after all, if the patent-holder isn't making such a hullaballoo about the copying (think of the Metropolitan Police in London taking the BBC to task for copying the police-box design - admittedly a trademark case but the principles are the same - and being thrown out of courts with the question, "Why didn't you say something earlier?")

Another example is the introduction of the basic oxygen process for making raw steel from pig iron. Invented by VoestAlpine in Austria, this introduced a 30-minute process for making hundreds of tonnes of steel when the next best process took hours. When introduced in the early 1950's, VoestAlpine became the leading steelmakers in the world, and began selling it to everyone. The Japanese, of course, were very early adopters and when VoestAlpine made errors in protecting their patents, they lost control over the adoption of basic oxygen steelmaking in Japan and it was on for young and old.

So, scrapping the entire patent system is not a good idea, however as patents primarily help to foster innovation in capital-intensive industries, exactly how this applies to software is a bit beyond me and that's where there may be room for improvement.

This is my point in all of this. I'm a programmer, so I know that the cost of software development is relatively tiny. Trade secrets are a better fit for software, rather than patents. For example, we do a certain accounting process that another company also does. We do it better. We aren't going to patent it for 2 reasons: 1. the two lead devs (me and another guy) are vehemently anti-software patents and 2. it's not worth it. That process is an advantage, but if they improve their system then we have other things going for us. If they copied us, directly, then that would be a matter of copyright, not patent law.

I guess a good way to describe it is that many industries have R&D (steel for a relevant example), but it is a side part of the company, with most of the turnover being in production (labour, materials and actually selling a product). You could remove a steel company's R&D department and it would keep going for a while before lack of progress killed it. Remove a software companies R&D department and you have a CEO and accountant and a janitor. There would still be the software to sell, but competition would eat you in weeks, rather than the months or even years other industries have.

Methinks that you are torturing your logic against the Geneva convention rules.

The United Nations and the European Union are multinational nations that are not signatories to the Geneva Conventions, and thus are exempt (Israel and the USA are on this list, but use chemical weapons without repercussions [i.e., white phosphorus and Agent Orange], as well as torture).

In addition, those who declare sovereignty, being given power by whomever can endow it, are themselves not subject to that selectively enforced treaty. It's like charging someone with "Murder in Violation of the Law of War" when they were not subject to your law. It's inventing a crime just so you can justify punishing people further for thinking differently.

I can't possibly conceive that rogue courts have invaded the lives and liberties of others, yet. I'm still blinded by apologism to defend my pride.